Operations strategy in an emerging economy: The case of the Ghanaian manufacturing industry

Abstract

Operations strategy and its development have received a lot of attention in the operations management literature. However, as noted by Ward et al. (1995), an understanding of the factors that influence operations strategy development has not been widely studied. Further, how managers of firms in underdeveloped countries develop operations strategy has yet to receive any significant attention among researchers. This paper takes a look at the development of operations strategy in an underdeveloped economy, Ghana. Specifically, the paper examines the relationships between the business environment and the operations strategy choices made by firms in Ghana. The paper seeks to understand the influence that specific business environmental factors have on the operations strategy choices of low cost, quality, flexibility, and delivery dependability. A survey of manufacturing firms was carried out in 1998. The respondents (production managers in those firms) were asked to indicate the extent to which business costs, labor availability, competitive hostility, and environmental dynamism were of concern to them. They were also asked to indicate their extent of emphasis on the operations strategy choices of quality, cost, flexibility and delivery dependability. This paper presents the result of the analysis of the relationships between the environmental factors and the operations strategy choices. The data indicate that, among firms in Ghana, the two strongest factors that influence the degree of emphasis placed on operations strategy choices are perceived business costs and competitive hostility. Results are presented for both large and small firms, and for firms that are completely locally owned as well as for joint venture firms.